More good news for the troubled real estate market: According to a recent report, home foreclosure rates are continuing to drop across the country. Although Florida was still named as one of the states with a high share of residential properties in foreclosure at 2.9 percent, the news is, nevertheless, encouraging and indicates the Great Recession, as it was called, may be coming to an end.
Overall, around 41,000 home foreclosures were completed nationwide in May, which was down 19 percent from the previous year and down 65 percent from the 2010 peak of the recession. However, these 41,000 foreclosures represent almost double the monthly amount seen before the recession started. Although that may seem discouraging, the overall downward rate of foreclosures since the real estate market's burst should be promising to all with a vested interest in residential real estate.
Analysts point to several factors that have contributed to the drop in foreclosure rates. The creation of some 3 million jobs in the past year has improved the labor market and has helped homeowners stay on top on their mortgages. Furthermore, the rise in home prices means more equity for homeowners, so they can sell their current homes without suffering as big of a loss. Rising home prices also means less negative equity in the home, meaning that the amount borrowers owe on their homes is not as disproportional to the value of the home. This is also good news for Florida homeowners as the state was listed as one of the top five states that make up nearly one-third of all negative equity across the country.
Although still struggling as a market, Florida nevertheless seems to be on a rebound with the rest of the country. However, Florida homeowners who find themselves facing foreclosure could consult with a real estate attorney about their options regarding the process.
Source: MarketWatch, "Homes are less likely now than at any time since start of Great Recession to be in foreclosure," Ruth Mantell, July 14, 2015